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Executives

Alexander Mandel - Chief Financial Officer

Douglas R. Lebda - Founder, Chairman, Chief Executive Officer and Member of Executive Committee

Analysts

Lauren Slabaugh - Stephens Inc., Research Division

Shawn Rassouli - Needham & Company, LLC, Research Division

Hamed Khorsand - BWS Financial Inc.

James J. Fowler - Harvest Capital Strategies LLC

Tree.Com (TREE) Q3 2013 Earnings Call November 7, 2013 11:00 AM ET

Operator

Good day, ladies and gentlemen, and thank you for standing by. And welcome to the Tree.com Third Quarter 2013 Earnings Conference Call. [Operator Instructions] As a reminder, today's conference is being recorded for replay purposes. I'd now like to introduce today's host for the call, Chairman and CEO, Doug Lebda; and CFO, Alex Mandel. Mr. Mandel, you may begin your conference.

Alexander Mandel

Thanks, operator, and thanks to everyone for joining us today for Tree.com's Third Quarter 2013 Earnings Conference Call.

First, a quick disclaimer. During this call, we may discuss Tree.com's plans, expectations, outlook or forecast for future performance. These forward-looking statements are typically preceded by words such as we expect, we believe, we anticipate, we are looking to, or other similar statements. These forward-looking statements are subject to risks and uncertainties, and Tree.com's actual results could differ materially from the views expressed today. Many, but not all of the risks we face, are described in our periodic reports filed with the SEC.

On this call, we'll discuss a number of non-GAAP measures, and I refer you to today's press release available on our website at investors-relations.tree.com for the comparable GAAP measures, definitions and full reconciliations of non-GAAP measures to GAAP.

To put my remarks today in context, in the third quarter, total Mortgage originations industry-wide declined by 27% year-over-year, based on an average of market data from prominent sources. This was the result of a 44% decline in refinance volumes, partly offset by a 16% gain in purchase volume. The resulting share of refinancings declined to 54%, which is down notably from 71% in the third quarter last year.

In contrast to this 27% decline in total industry originations, our Mortgage products revenue in the quarter grew significantly by 73% to $32.6 million. This also marks our fourth consecutive quarter of company outperformance relative to the market.

We attribute our continued outperformance to a number of factors. First, our new national ad campaign, which launched in mid Q2, helped to support strong lead volume and our reduced expense in the quarter. Second, our marketing efforts across our core digital marketing channels continued to scale profitably in the quarter. Third, the monetization of our leads improved amid strong lender demand. And fourth, our continued focus on innovation and development of new and improved offerings to better and more fully serve consumers and customers has borne fruit.

In 2013 alone, our new Mortgage rate table product and reverse Mortgage offering and our improved personal loan offering have continued to grow and contribute to our results. These revenue streams are the result of internal product development efforts with limited capital investment and impressive returns to date.

Our Non-Mortgage products revenue also grew year-over-year by 13%. All in, consolidated revenue of $37.3 million in Q3 was up 60% over Q3 2012 and exceeded our prior guidance.

From a profitability perspective, the company delivered $15.1 million of variable marketing margin, representing a fourth consecutive quarter of new record levels. As a percentage of revenue, VMM improved to 40% from 37% in the preceding quarter, which was anticipated, given reduced expenses related to our national ad campaign, relative to Q2 when it launched.

Adjusted EBITDA of $5.4 million in the quarter was up 38% year-over-year. And like variable marketing margin, our adjusted EBITDA result represented another record level and exceeded our guidance. Included in this result is a positive contribution from our Non-Mortgage segment.

Touching briefly on our discontinued operations, which primarily represent our former Mortgage origination business. The financial impact of this segment was a loss of $529,000, generally related to ongoing wind-down efforts, and represents an improvement over Q2.

From a balance sheet perspective, our unrestricted cash grew by $2.5 million over June 30, to $87.8 million at September 30. During the quarter, we were able to reduce collateral for various surety bonds maintained by the company, which was previously classified as restricted cash by over $4 million. At the same time, we deployed cash to repurchase approximately 1.8 million of shares during the quarter.

Our working capital position at quarter end, which we calculate as current assets, including unrestricted and restricted cash, minus current liabilities, which includes loan-loss reserves, was $71.7 million at September 30.

In conclusion, we believe our third quarter demonstrated a strong performance, as we exceeded prior guidance on all financial metrics, achieved record variable marketing margin and adjusted EBITDA results and gained market share.

And our Mortgage business continues to outpace the market. Our Non-Mortgage segment continued its resumption of profitability. And we are actively focused on product innovation and diversification, both to provide new growth opportunities, as well as address the shifting market environment we're operating in.

I'll now turn to Doug for his perspective.

Douglas R. Lebda

Thanks, Alex, and thanks, everyone, for joining the call today. The third quarter was another great one for Tree and I couldn't be happier with the results. I'd like to hit the highlights in our Mortgage and Non-Mortgage products, walk you through our updated guidance for Q4, and probably most importantly, discuss our expectations for 2014.

Starting with Mortgage, we had another quarter of very solid performance and continued our trend of separating our results from the overall market. In a quarter where Mortgage originations fell 24% quarter-over-quarter, our Mortgage revenue was virtually flat from Q2 and up 73% from the same period last year. This growth is, simply put, fantastic and a testament to our proposition with lenders in a very difficult market for them.

More importantly, we have continued to execute in our purchase Mortgage strategy. During the quarter, we increased the number of lenders taking purchase leads at an unprecedented clip. In Q3, we grew our network of active purchase lenders by 38%. And on a year-to-date basis, that number is up 117%.

Unit revenue continues to increase substantially and the combination of our increasing organic traffic, plus our paid marketing, is truly paying off. The results are clear. Revenue from purchase mortgage is now almost 40% of total Mortgage product revenue and our purchase Mortgage business is up 250% from the same quarter a year ago.

To sum up our performance in Mortgage, we're driving quality volume to lenders who need it badly, taking market share in both purchase and refinance, seeing improving unit economics as our network of lenders demand our services now more than ever, and leveraging that improved revenue to market online and offline.

In our Non-Mortgage business, we're also seeing significant improvement. Revenue from Non-Mortgage products was $4.7 million, up 22% quarter-over-quarter and 13% increased from last year. Auto finance continues to grow and improve profitability, personal loans and reverse mortgages are growing at significant rates, education continues to show progress under new leadership and our Home Services business achieved profitability in September. We are now solidly profitable in our Non-Mortgage products and have great management. The single platform strategy for marketing technology enables us to capture best practices across verticals and keep costs down. With that foundation laid, our focus now is simply scale.

Now let me turn to our updated guidance for the rest of the year. For those of you who have tracked us for several years, Q4 is typically a seasonally slower quarter for us. Consumers tend to focus on holidays instead of finance, home improvement and education. And media rates increase as retailers push holiday shopping. That said, for the full year, we're increasing our full year revenue guidance, yet again, to $135 million to $138 million and expect adjusted EBITDA for the year to be between $16 million and $17 million.

What that implies for Q4 is revenue of $32.2 million to $35.2 million. For VMM, we expect Q4 to be $11.8 million to $13.8 million, and adjusted EBITDA to be between $3.2 million and $4.2 million.

If we close out the year at the midpoint of our guidance, we will have increased revenue 45% over 2012 and adjusted EBITDA by 16%, all while still investing in our brand, product and technology.

Today, we're also issuing our expectations for 2014. Our plan is to continue to deliver substantial growth, on both the top and bottom lines, while continuing to invest for the long term. We're expecting top line revenue to grow between 10% and 15% next year. In a Mortgage market projected to contract another 27%, this would mean not only great growth, but also very solid share gains.

Variable marketing margin, we believe, will be $62 million to $66 million, an increase of 13% to 20% over the midpoint of our guidance for this year. And we're expecting adjusted EBITDA for 2014 to be between $20 million and $21 million, which is a 21% to 27% increase from 2013. Given our success this year, diversifying our revenue streams away from refinance and into purchase and Non-Mortgage, as well as gaining share in Mortgage, I'm confident we can continue to achieve significant growth next year, like we did this year, and that growth -- and growth that places us among the top tier of our peer group.

To sum up the quarter, I am extremely pleased with our results, not only for the quarter, but so far this year, but we're not sitting still. Expect us to continue to leverage our clients' demand for new customers, continue to take share in all markets where we compete. And we think that we're still in the very early innings here and that we're uniquely positioned with a great brand, a very solid financial position, and most importantly, the right group of passionate people working hard every single day, to make something very, very special happen in the coming years.

With that, let's open the line for Q&A.

Operator

[Operator Instructions] And it looks like our first question in queue will come from the line of Lauren Slabaugh with Stephens.

Lauren Slabaugh - Stephens Inc., Research Division

So my first question is about the monetization of leads. And so what I'd like to understand is how pricing broke down this quarter in terms of both purchase and refi, and if you're starting to [indiscernible] price, or how that's looking?

Douglas R. Lebda

Could you repeat the first part of that, you were a little garbled there. You asked about pricing in the quarter?

Lauren Slabaugh - Stephens Inc., Research Division

Curious -- trying to understand how you are better monetizing leads, as you mentioned. So -- and really what I'd like to do is understand how that breaks down between purchase and refi?

Douglas R. Lebda

Got it. So as you might expect, we actually don't disclose individual pricing to the market because our competitors would copy it. And so that's why we like to stick with overall variable marketing margin. And pricing, depending on the lead type, between purchase and refinance and even inside of segments -- inside of those products, it's really -- the way to think of it, it's a bidded environment. The closest thing to it would be how Google prices cost-per-click advertising. If lenders want more, they increase their caps and they increase their -- the price they're willing to pay at whatever their filter level is. And then an algorithm picks the lenders that are best matched with that consumer, based on a combination of various factors, which we also like to keep in our secret sauce. But what I can say is that, that overall expected value per lead is up significantly throughout the year. And I'm looking at a chart now, that's basically up and to the right across all products, but I won't show you any numbers. And it's happening inside both purchase and in refinance. Not only that, that would be the unit cost per lead, but we're also seeing increase in what we call transmit rates and transmits per, which is the percentage of consumers we can match and the number of times we can match each customer. So I wish I could give you more of those numbers, but it would be a competitive issue. And really, the thing to look at, I guess, is overall variable marketing margin.

Lauren Slabaugh - Stephens Inc., Research Division

I completely understand, and that's helpful. And I guess, the next question is more on the share gain. And clearly, you all are doing a great job and outperforming here where some of your competitors are not. And so what's driving that? What is driving people to want to use you more? Is it better conversion rates, what are you all doing that's right?

Douglas R. Lebda

From a lender's perspective -- so first off, when a lender, and I'm sure you've heard me say this at various conferences, but if a given lender's makeup of leads where they are generally capacity constrained, let's say they're getting 50% of their volume through organic or free sources from prior customers, when that goes away, as rates go up, and that sort of free refi volume goes away, they have to increase spend on third-party advertising, whether it's us or Bankrate or Zillow, or anybody else. And they really focus on what's, what we think of as a cost per funded loan. So lenders don't think of -- we get our money on a lead, they're thinking of a cost per funded loan. And they increase their spend because they need the volume and it's working. So the reason we would work better versus our competitors is because the legacy -- the 16-year legacy of our brand means that consumers are more likely to get up -- we're not getting traffic from, it was described to me, the punch-the-monkey-in-the-face banner ad, and all of a sudden, you're getting a call from a mortgage lender that you never meant to get a call from. Our traffic is much higher quality sources. It's people who know and trust our brand. They get up off the couch, they go to a computer or mobile phone and interact with us or call us, and we warm transfer them. We can afford to pay through high -- very high quality traffic sources, particularly search, and then, obviously, generate a lot of repeat customers as well. So we drive in higher intent to actually get a transaction. Therefore, we can get higher revenue for those leads. And then therefore, we can afford to plow that back into driving even higher quality traffic. So quality is what we always focus on. There's plenty of companies that have screwed that up along the way by sacrificing quality and conversion rate. And just like Google dominated the search market by providing very high quality traffic to advertisers like us and millions of others, we hope in a small way to continue to do that. So it really is a dynamic market on both the supply and demand side. But the short story is that as long as we're hitting the cost per funded loan goals, lenders will continue to scale up. Not to go on too long, we're seeing particular success now with new types of institutions, not only traditional correspondent lenders, but also major banks signing up and joining the network, or at least having discussions with us. We're starting to see signs of life or hear signs of life in the home equity business, which we think bodes very well for next year. And importantly, in purchase, those more traditional banks are doing great business with us. So it's hitting across the board.

Operator

Our next question in queue will come from the line of Shawn Rassouli with Needham & Company.

Shawn Rassouli - Needham & Company, LLC, Research Division

I had a few please. But if I could just dovetail on the last topic we spoke about, can you give us a sense for how much headroom these lenders have, where cost per funded loan is just too high and they're not as profitable or they approach breakeven level? Any sense for how much more room there is to increase sort of price per lead going forward?

Douglas R. Lebda

Yes. And again, it would be something -- if I gave specific numbers, people could reverse engineer our pricing. But suffice it to say, there's a lot of room, and there's also room on the volume side, too. So lenders are not losing money. They're absolutely still profitable through the channel. What you will start to see -- and by the way, pricing at a lender doesn't just vary lender to lender. It actually varies loan officer to loan officer. So one of the things -- there's been lots of buzz recently about layoffs in the mortgage industry. Mortgage lenders, actually, if you had a sales floor of 100 people, the conversion rate of your best loan officer might be 20% and your worst guy might be 1%. So what you start doing is cutting back the people who can't convert the leads on a profitable basis. So you would have some loan officers that are highly, highly profitable, and others that are not. That said, what you're starting to see at lenders, which is very natural, is margin compression, and that's talked about in the industry. So their marketing cost per funded loan will go up, and their revenue per loan will go down because of increased competition in the market among lenders. And so their margins will get squeezed. What the really smart guys do is they will run their -- in the mortgage business, it's make hay when the sun shines, and the smart guys will maintain as much capacity as they can as rates rise so that they can catch it on the other end. We are seeing no signs among our client base of pulling back yet. And when we do, honesty, we will tell you. I keep -- I walk the sales floor here all the time, I say, tell me what's going on, and they're saying, they keep asking us for more, they're still asking us for more volume, they're trying to -- they're increasing their buy, and so that's all good. So what you'll see -- and the other effect that we're starting to see is guidelines are starting to loosen a little bit. Lenders will open filter segments in areas that aren't necessarily and perfectly in a sweet spot. To continue my Google analogy, it would be the difference between me buying the head term mortgage rates versus buying refinance calculator, which would be a much lower cost per click and a lower conversion rate. So you start to see that effect, and as that sort of long tail effect takes -- helps us, that helps us to improve our overall revenue. So I see no signs yet among our lender population of pulling back. One additional comment I want to make there, and we were going through our internal budget process yesterday, and really delved deep in this, is in the purchase market, in particular, and hats off to a lot of people here who got in front of this. We have been saying for probably 15 years, the purchase market is coming, you've got to get ready next year. This time, we said it again, and we meant it. We prepared best practices. We got presentations to -- in lenders' hands, and got them probably 6 or 9 months ahead of this, actually testing, experimenting, putting on new purchase teams. And so that's -- a lot of what you're seeing in the market is, among lenders, is they're clearly downsizing their refinance teams. But at the same time, they're increasing their purchase teams to combat that. And then we're hopefully going to help guys take share. We think we're great for comparison shopping and I feel -- this feels to me similar to the travel industry after 2001. And for people who were around back then, it was tough to get hotels to come online to these hotel websites. Because before that, they were selling all the inventory they could. So they didn't want to put inventory out on the web, to people like Hotels.com and others, and when that -- when there was excess capacity, that flooded and that changed the whole game for the online travel industry. And it feels like we're doing -- the same thing is happening as well. Now what we need to focus on next is helping these guys increase conversion rates through product improvement and that's our plan. That is the plan for next year. This year was about sales and marketing, the last few years were -- that will continue, the product improvement slate for next year. To help them improve conversions is really what we're focused on now.

Shawn Rassouli - Needham & Company, LLC, Research Division

Perfect. That's very helpful, Doug. And you touched on this briefly, but could you expand further and talk more about your sales efforts into retail banks. Maybe give us a sense for what that activity looks like. Is it Mortgage only, or is it -- does that involve other types of loans on the Mortgage side? Is it mostly purchase leads? And if you have any metrics to share there, whether it's the number of banks that you've signed up, revenue or anything would be great. And maybe just as an add-on, where do you see that sort of segment go next year? Do you -- down the road, do you see it becoming as big as sort of the correspondent lender sort of opportunity for Tree?

Douglas R. Lebda

So a couple of anecdotes, and I think I'll give you -- I think I can give you one number to whet your appetite, unless Alex starts kicking me under the table here. But it is, absolutely, mostly purchase. And interestingly, what we're seeing among these lenders is a new model where instead of sending customers to a call center, they're routing these to local loan offers and local branches. And that's working very, very well. So the call center-based guys might have instantaneous technology, get you on the phone very quickly, maybe very aggressive pricing. But what we're seeing with some of these other guys is the ability to send some leads to local people. And more on that to come. It's a test right now, very small, but we're starting to see that -- see a lot of interest there. Another anecdote I can share with you is -- I have a joke with our sales team. There's one very large bank that probably since 1997 has been ready to join the network. They've been thinking about it. For the first time, I have a revised contract in legal and they had about a dozen people down here from a third-party firm, crawling through everything to make sure that we pass all the vendor agreements, et cetera, et cetera, that they need to do. So that's another anecdote. And I can tell you, another bank who was working with us on a cost per funded loan basis has -- I won't give the exact number, but their cost per funded loan is running about 1/3 of what the network average is for sort of a normal correspondent lender. And those normal correspondent lenders are doing just fine at that price point or that cost per funded loan. These guys are 1/3 of it. And so they can really -- they're going to start to step on the gas. At our board meeting yesterday, one of our directors shared with me that the banks he's talking to are hearing that people are starting to open home equity again in 2014. That market went away from us in 2008, dropped off, effectively disappeared. We don't have any new banks signing up for home equity yet, but we're starting to get some -- we're starting to get inquiries and we're actively pushing it. If we can bring back -- if the home equity business comes back, there were times that, that business was maybe not as big as our Mortgage business, but pretty darn close.

Shawn Rassouli - Needham & Company, LLC, Research Division

That sounds great. And if I could just ask one more and -- before I get back in the queue. So I was wondering if you could share some sort of color on the media rates, right? Which marketing channels are you seeing the most upward pressure on rates? And how do you see that trending over the next several months? If you have any insight there, it would be great.

Douglas R. Lebda

Sure. So across all the channels, we're not seeing a lot of margin compression, except as we increase spend. So search, for example, if I want to double my volume, I've got to spend more, and therefore, I'm effectively upping my own rates. But there's a lot of still search opportunities for us that -- where we can actually increase coverage and drive in more volume. And as I said, our organic work for the past year has been -- has worked extremely well. The only place we're seeing, I would say, any inflation in media rates are probably offline. And that only shows up for us because we mostly buy in sort of the DR and the spot markets in how much we can clear. So we know what we're willing to pay for media. And there are times that we can't get everything we want because we're not an upfront buyer anymore, where you really pay premium prices. So it'll show up in there a little bit, but we can still find in that, and so that's -- and that's okay, because offline, while it's profitable, it doesn't need to be there all the time, it's there. It also helps the overall brand. So I think that's the biggest one for us. And as I said, next year, as we focus on lifetime value and conversion rate initiatives, that's where then you can see more upward pricing. And to your previous question, when lenders get higher conversion rates, their cost per funded loan goes down in a direct relationship. And as we help them, through product and technology, importantly, to decrease cost per funded loan, loan costs, we get that almost -- you get most of that right back in revenue, so -- and increased unit cost. So that's why we've always been so focused on making money when our lenders make money. But so far, I'm only seeing media inflation in the offline world as the economy picks up a little.

Operator

Our next questioner in queue will come from Hamed Khorsand with BWS Financial.

Hamed Khorsand - BWS Financial Inc.

Just a quick question. Could you provide some insight on where you see growth coming from for next year?

Douglas R. Lebda

Growth coming for next year?

Hamed Khorsand - BWS Financial Inc.

Yes.

Douglas R. Lebda

So I think -- interestingly, it's kind of a boring answer, I think it's going to be just a continuation of what we're seeing this year. It's not -- you could roughly take the Q3 run rate. And now there's some seasonality, ups and downs in it, but you see where we are in Q3 and back of the envelope, multiply it times 4, and there you kind of got 1 year. But it's not -- so we don't need to do -- our philosophy has always been, we like to be -- we like to give investors good, solid growth. And we think 21% to 27% earnings growth at our nice multiple, but reasonable multiple, at least compared to guys like Zillow and others who have growth rates roughly equal to ours and trade at who knows how many thousands of times higher multiples. We think that's really solid growth. And then after that, we reinvest back into product and technology. But we're absolutely going to see growth in Mortgage. But it's not crazy growth. It's just continuing the trend. We're going to see growth in the Non-Mortgage businesses. I'm particularly excited about the -- about what's coming in Home Services. But also, really excited about all the new things we're doing on LendingTree, in terms of reverse mortgage and credit cards and home equity. So what our practice, typically, is we do an internal budget, we do an internal plan, all tied down to the nth degree. And then we look for bolt-ons and new opportunities throughout the year that will hopefully get us even more. So we plan according to what we know, and then we try to go higher than that with some new stuff. Not all the new stuff works out, but it's going to come from just continuing the trends, as boring as that might sound. And then we want to get supercharged growth over the next few years through some other things. I've said publicly, we're looking at M&A. We've looked at a bunch of stuff and haven't pulled any triggers yet. There are definitely opportunities for new products, for launching new products. There's definitely opportunities for improvements in technology, which you'll -- we'll talk more about over the coming quarters. But I can tell you, I am absolutely thrilled with where we are on product and technology. And then continuing improvements in marketing and adding new lenders. It's not a rocket science plan to kind of get that mid-20-ish percent growth.

Hamed Khorsand - BWS Financial Inc.

You mentioned Zillow. Where do you see yourself against Zillow next year? How are you going to stay ahead of them?

Douglas R. Lebda

Look, they're -- interestingly enough, if you look at their mortgage revenue versus ours, I think they were -- they have a $4 million or $5 million a quarter Mortgage business. And I think it was 5 point -- $5.5 million, almost $6 million or something like that. You can see what our numbers in mortgage are. But they're a good, solid competitor. We think they're -- one of the ways they got so good is by infringing on our intellectual property, which we think a court will figure who's right on that one over the next 12 months. And yes, they have great organic traffic and so therefore, they're able to leverage on a mortgage product. Their mortgage product works really well for some lender and other lenders don't like rate table products in general. We have a rate table product, too. But the market's big enough to have a whole bunch of us. We're -- this is a major market. LendingTree, as much as we gain share, we might be over 1% of the U.S. mortgage market now and still at fairly low conversion rates. So there's plenty of -- my guess is they're coming off a pretty low base, so their Mortgage volume will grow faster than ours on a rate basis. But we think there's plenty of room to go. One of the other growth opportunities for us is syndication, having the highest monetization, best customer experience out there. We think we have opportunities to partner up with both personal finance websites and real estate websites, clearly not Zillow, who are -- who want to have a mortgage product just like Google syndicates their search listings around the web, and we think we can give people high -- very high revenue share, very -- we can give publishers a great product in there and have a very nice pipeline of potential business development deals, too, that will come through in a rev share basis and really help us grow share.

Operator

Our next phone questioner in queue will come from the line of Jim Fowler with Harvest Capital.

James J. Fowler - Harvest Capital Strategies LLC

A lot of mortgage companies reporting today, so I haven't been through your numbers. I knew the stock would be fine. I just wanted to ask you one detail question, more of just an education for myself. You mentioned the Reverse Mortgage business. I'm just wondering, a lot of rule changes have taken place there in terms of products and the like. Have you seen any difference in that channel over the past period of time since the rules have changed?

Douglas R. Lebda

So we only launched that at the beginning of year. The rule changes, I'm not exactly too familiar with those. The one change I can tell you is we have more demand for leads right there than we are currently generating and are rolling out marketing now against that product. So we've pushed -- lenders have pushed up the revenue per customer enough that we can afford to go start doing search and do some display and potentially, some offline. And so we're seeing, if anything, from our standpoint, it's heating up. Now that could be because the market is heating up, or it could be because conversion rates are getting better, or it could be because we started at a low pricing, and now the lenders are bidding up the price. Or it could be that conversion rates are great on our traffic, and therefore, they want more of it. I'm not quite sure, but we're -- I'm seeing a lot more demand for those customers than we have today. And we plan to rectify that and really grow that business.

Operator

[Operator Instructions] And it looks like all our questions.

Douglas R. Lebda

Okay. Well, thank you, all, again for your attention today, particularly in light of a rather -- another somewhat famous Internet company that's probably trading while you're sitting here listening to us. We appreciate your time and attention, appreciate your support of our company. As always, feel free to reach out at any time and we look forward to being transparent going forward, and hopefully putting up more great numbers for shareholders to participate in. Thank you.

Operator

Thank you, sir. And thank you, ladies and gentlemen, again. This does conclude today's call. Thank you for your participation and have a wonderful day. Attendees, you may now all disconnect.

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